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Uniswap proposes new fee mechanism
UNI surges rapidly but harms Compound
The governance proposal “Activating Uniswap Protocol Governance,” created by Erin Koen, the head of governance at the Uniswap Foundation, will be released on March 1, 2024, while on-chain voting will begin on March 8, 2024. According to the proposal, the protocol will create a fee mechanism, distributing the collected transaction fees to UNI token holders who stake their tokens.
Since the proposal’s release, the price of UNI tokens has surged by over 50%, benefiting other similar tokens such as SUSHI and CAKE, which have also experienced synchronous increases. Arthur, the founder of DeFiance Capital, commented that this proposal by the Uniswap Foundation could bring new catalysts to DeFi applications.
Interestingly, according to information shared by renowned KOL Spreek, the rapid surge in UNI’s price has caused price oracles to lag behind the price changes, resulting in Compound, a decentralized lending protocol, incurring $3 million in bad debt.
